Investor Fear Chart

Bulls 28.1, Bears 40.7

Bearishness has not been this high (three weeks now) since October 2020.
 
Bears unchanged, Bulls +7% to 29%.

According to AAII
*Pessimism is above average for 8th time in 10 weeks
*Pessimism remains near the top of its typical historical range
Click to expand...
 
Finally, a non-boring reading in the AAII.

Bulls at 22, lowest since July 2020.
Bears at 39, lowest since October 2020.

Ratio of .57 which leans bullish.
 
Funny how so many were "looking for a dip to buy" the past few weeks. Here it is, yet fear reigns supreme. Don't follow the crowd.

fear3.JPG
 
AAII comes in at 40 Bulls, 20 Bears, which is a low bearish number.

Mostly just data mining here, but early April brought a decent sell signal with 51 or so Bulls and 20 Bears. Would selling have been the right move? Probably not since the market has been trending sideways since April with a small spike higher. AAII continues to indicate a sideways trending market which makes sense. I can't imagine there being as many market participants this summer with the reopening.
 
Two things.

1. The chart in post #44 shows a flat/choppy market from May until August for the first year of a Democratic president.

2. CNN Fear/Greed index is at 30 right now which is around where it was in late October until the election.

If this bull market is still intact (and all indications appear it is) then chances are this is the beginning of a good buying opportunity similar to that of September to November 2020. Low can always go lower, and trying to pin a bottom is a fools game, but those who like high flying PE stocks can get 'em a whole lot cheaper today than a few months ago.
 
AAII showing no fear at all with bull bear ratio at 1.5. We'll want to see this down at 1 or lower for indications of a turn.

40 Bull to 25 Bear which is still quite bullish.
 
Off topic, but related, the seasonality chart for February did a pretty good job as well of forecasting direction.

022721a.gif

Chart provided courtesy of www.sentimentrader.com


March is similar with an even more pronounced difference between the first and second half of the month. I'll post that in Monday's commentary.
 
Bullitt said:
AAII, even less bears this week, but if the poll was taken today that would surely be higher.

Not sure where to post this, but here's how markets behave 1st year post election. Correction, then rally? February 2021 was an up month though. Full moon this weekend sometimes marks a turn.

View attachment 48533

https://jeffhirsch.tumblr.com/post/...sidential-election-anticipation-is-keeping-us
Click to expand...

Here is why this one is different:

All those other “1st year Dem’s” have been with new people forming a new government. This time Biden has enough experience to hit the ground running, and has already gotten many of his policy changes that he can do by executive order already issued, and many of his people settling in to the places needed most. I think he’s going to be much quicker on jump starting the economy- if he can just get the 1.9 trillion jumpstart through. That should bolster the markets in the next month.


Sent from my iPhone using TSP Talk Forums
 
Big jump in bullishness past two weeks, 37.4 to 47.1 today. Bearishness has also dropped 35.6 to 25.4.

We really haven't seen a good pullback since late September and since then, bullish readings have been quite elevated at levels higher than any seen in over two years. It's a government policy rally and participants are happy as long as the government continues to stimulate or talk more of it.
 
AAII, Bulls keep dropping as the market marches higher. Bull/Bear ratio around 1.05, right where we were just before election.

This week compared to the historical average of bulls is around normal, but the bears are 5% higher than average.

https://www.aaii.com/sentimentsurvey?
 
It's all about the extremes on both ends. March to May 2020 saw multiple weeks with bears over 50, a number not seen with such consistency in many years.

AAII members have often kept more than half of their portfolios in stocks even when their collective pessimism about the short-term direction of the S&P 500 index has been comparatively high.

This is not paradoxical. Disciplined investors prevent their short-term outlooks from interfering with their long-term strategies.
Click to expand...

waerwegsd.JPG
 
CNN back to near neutral. CNN is more of an immediate term indicator whereas AAII is a projection 6 months out. AII is still very affected by near term sentiment.

cnnd.JPG
 
AAII at 43 bull, 22 bear. Ratio this week is 1.98. Ration of 2 or higher is considered bullish extreme.

"What direction do you think the stock market will be in 6 months?"

Bears have dropped steadily every week since late September high of around 45.
 
B of A fear chart (below) not telling us anything at this juncture, but CNN is at 86 which either says "don't buy here" or that there is such a flood of assets that continue to come off the sidelines that this reading is okay.

I tend to think this bullishness will peter out in mid-late December only to see another ramp up in January with the January effect.

73ac6f4ac22ec6ce75b98d0a80f47149.png
 
AAII at 49% bull this week.

Consistent weeks around 50% bull tend to signify a top or near top - but not always. This was the case in Jan 2014, Sep 2014, and Jan 2018. All three saw some kind of correction to the downside.
 
AAII came in at 55.8% bull vs 24.9% bear.

Last time numbers were this skewed was January 2018, a few weeks before that February 2018 drop.
 
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